India, Australia to invest $3 mn each in critical mineral exploration

State-owned firm to lead first-such investment by India for energy security

India and Australia, in the first such partnership between them, will jointly invest $3 million each for five critical mineral exploration projects in Australia. KABIL, a state-owned firm, will lead the investment for the Indian government, said officials.

Details of the partnership agreement—initiated during the Australian Prime Minister’s visit to Delhi last month—are being finalised and the investment will be the first step in building a critical mineral supply chain, said a senior Indian official.

“This is one of our first and major overseas investments in critical mineral exploration. It is part of our plan to have critical mineral ownership to secure supply for our energy security,” said the official. The five projects are currently at the exploration stage and the Indian government will look at supplies later.

“KABIL will steer the investment and the business opportunities. Out of the five projects, three are lithium and two cobalt explorations. KABIL will partner with Australian companies,” said the official.

Khanij Bidesh India Ltd (KABIL) was announced in 2019 as a joint venture of three public sector undertakings (PSUs) under the ministry of mines. National Aluminium Company (Nalco), Hindustan Copper (HCL) and Mineral Exploration Company Ltd. (MECL) each has stakes in KABIL in a ratio of 40:30:30.

A government statement said in 2019 that KABIL would carry out identification, acquisition, exploration, development, mining and processing of strategic minerals overseas for commercial use and meeting the country's requirement of these minerals.

“The sourcing of these minerals or metals is to be done by creating trading opportunities, G2G (government to government) collaborations with the producing countries or strategic acquisitions or investments in the exploration and mining assets of these minerals in the source countries. The new company will help in building partnerships with other mineral rich countries like Australia and those in Africa and South America,” said the statement.

Australian Prime Minister Anthony Albanese, during his visit, had critical minerals as the core agenda of his delegation’s meeting with Indian officials. Madeline King, minister for resources and minister for Northern Australia, told 'Business Standard' in March that when India-Australia entered into a critical mineral investment partnership last year the two governments were looking to do due diligence into projects together.

“We want to work with like-minded partners like India, who is a strategic partner through QUAD. When India invests in Australia, it invests in securing its own supply chain. That will also include mineral extraction, processing and a few steps along that supply chain and a part of that will go into India’s battery manufacturing supply,” said King then.

Apart from Australia, India is also looking at Argentina as a potential partner in its efforts to bolster the critical mineral supply chain. Officials said a government delegation will soon visit Argentina to follow up on the three memoranda of understanding KABIL has signed with state-owned organisations of Argentina.